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Premier Foods boss plans to raise £400m

PREMIER FOODS is poised to tap investors for up to £400m, as it battles to reduce its debt pile. The Hovis to Mr Kipling group is expected to announce a rights issue and placing backed by its key institutional shareholders alongside its annual results this week.

The group is also talking to CCMP Capital, the US private-equity firm, which could act as a cornerstone investor for the deal. The fundraising would allow the firm to restructure its £1.8 billion debt pile, which is due to be refinanced in weeks.

The company racked up the debts through a string of acquisitions that brought some of Britain's most iconic grocery brands into one stable, including Branston's Pickles and Oxo stock cubes.

A final figure for the cash call has yet to be decided, although it is expected to fall between £350m and £400m.